There is so much noise out there that it can be challenging to find the right one for you. In business, your success could very much depend on the people you surround yourself with. And in this episode, our guest has created a new kind of marketplace that removes the noise of finding buyers and sellers within the energy space. Andy McDowell is joined by Matt Russell, the CEO of ProCents, where they help vet buyers and sellers, bring those partners together, help them increase their revenue stream, and build a true partnership. Matt shares with us how they started and worked on their mission. He then offers great lessons and insights on sales, processes, and leadership. So don’t miss out on this conversation to find out how this new marketplace can help not only you but the industry as a whole improve efficiency.
LISTEN TO THE PODCAST HERE
The New Kind Of Marketplace For Partnerships In The Energy Industry With Matt Russell Of ProCents
MARKETPLACE EFFICIENCY RISES THE OVERALL INDUSTRY
Welcome to the show. My partner in crime, Zach Levy, unfortunately can’t join us. It doesn’t mean he’s gone he’s not going to be here forever. He just couldn’t make this particular episode. This marks the start of season three. I’m looking forward to season three. I got a lot of great guests lined up for us from fall of 2022 to early 2023 already established. I’m looking forward to bringing those for you.
We got new music with every new season for the lead-in, the outro and so forth. I got a great guest for us to kick the season off. His name is Matt Russell. He’s the CEO of ProCents. He’s a subject matter expert, coach, speaker and entrepreneur focused on overcoming barriers to implementing time savings for clients. He’s the CEO and Chairman of the Board for ProCents where he and other experts help increase profitability through increased buying power.
As the Founder of R-Core, he teaches other professionals and organizations how to enhance their business success. His experience includes 25 years in sales leadership and development, 15 years in real estate and energy efficiency sales and 20 years as an entrepreneur. Over the last decades, he has provided guidance to aid in the efficiency decisions that have saved more than $1 billion. Matt received his Bachelor’s in Sales and Marketing, an MBA in International Business and MBA in Human Resources from DeVry University. Matt, welcome to the show.
I appreciate it, Andy. I’m excited to be the 1st guest on season 3.
You’re going to set the stage, so to speak, for season three for us. I’m excited for you to be here. Matt is in Atlanta. I’ve sat down and had coffee with this guy, breakfast, lunch and so forth. Part of the reason why I wanted to bring you onto the show is that I’ve gotten to know you as a person and your business. I’m excited for the audience to know about ProCents, which is a marketplace as opposed to a business model. I wanted to hit your bio quickly here. You spent 25 years in sales leadership and development. What attracted you to sales?
What attracted me to sales is I love interacting with people. Interactions with people inherently put you in sales. I like being on the front lines. I never wanted to be an actor, but being in sales, I get to put myself in different positions every day with every conversation. It always challenges me and puts me in a position where I’m always having to learn. One of the things I always ask for is better listening skills. To be a sales professional, you’ve got to be able to listen. That’s how I got into it.
If you had an 18-year-old or somebody coming out of college that says, “I want to get into sales,” and you can only leave them with 1 golden nugget to help them in their career in sales, what would that be?
The one thing that’s always helped me in sales is never to be afraid to ask because it’s never personal. It’s just business. If someone says no, ask, “Can you tell me what I could have done better to maybe get it over the line?” It’s over at that point but you’ve put yourself in the opportunity to learn from the people that you’re trying to service, which can maybe not open that door for that person but may help with a future conversation.
I’ve only served on a couple of juries in my life, but one of them was a civil case involving a car accident and an insurance company. The defendant was an insurance company. The plaintiff was the person that got injured. We ruled in favor of the defendant. We were putting our coats on in the jury room about ready to go home, and a young woman that was representing the person who got in the accident walked into the room and said, “This is my first civil case. I’ve been mostly over on the criminal side. Can you help me to understand how you made your decision so I can learn from this process?” She walked into the room and did the ask in an effort to try and improve the way that she helped service her clients. I’m always impressed when somebody does that because it tells me they have a growth mindset and want to learn.
You’ve got to be willing to learn in sales because every single person you interact with has a different perspective. That got them to that point and you got to be willing to listen to find that solution for them.
Let’s move into the ProCents side. For the audience, can you give the framework? What is ProCents? What is it set out to accomplish to do? What does it look like? Who are the members? I ask those types of things so that we can lay out the playing field. What does the pitch look like?
ProCents is a buying group. We bring buyers and sellers together within the energy space, whether you’re in lighting, EV charging, solar, wind or water conservation. We bring manufacturers to the buyers. There are a lot of manufacturers that have come onto the marketplace in the last several years that are not established. They’re not legacy companies that have been around for 100 years. They don’t have a customer base.
There are also new businesses that have come on to service the end users in this category that have not been in the industry for 50 years. They’ve only been in the business for 5 or 10. They’re these unforgotten. They’re doing great stuff within every one of their marketplaces, whether it be Oklahoma City, Nashville, Minnesota, or wherever they might be. They’re doing phenomenal work but they’re not getting the love. I created this community to help vet the buyers because there is a lot of noise out there and a lot with the sellers that you have to weed through. We can bring those partners together and help them increase their revenue streams and find value in building a true partnership.
Are there any other side benefits that you get out of this? I’m thinking about the industry level here. You’re trying to establish a marketplace, bringing buyers and sellers together, particularly the ones that are not the legacy or the main power companies to the table here, but what does a marketplace like this do for the industry overall?
We help strengthen the industry. The industry is led by people and the community is engaging these leaders within the industry to help find best practices. How process interacts is we are taking a transaction fee off this to help keep our doors open but we want our buyers and sellers to interact at a high rate. If they interact at a high rate and do certain metrics, we give them money back.
What happens is we take the buyers and the sellers and give them a rebate on both sides. This allows us to keep a mind share for both the buyers and sellers. Probably for the first time in history, the sellers are getting money back for interacting with customers, as opposed to them being the ones who are paying money for shelf space and mind share.
Is there some application process? Do you have some requirements or standards set as to who makes a good participant in this marketplace, regardless if they’re on the buyer or seller side?
We don’t have an application process because the application process comes word of mouth, with my years of experience or within the lighting space itself. No different people have left a company and started a company. Even though I might be friends with some of these people, you have to bill to do what you say you’re going to do. We say that communication is the barrier to success and most companies fell at communicating. Whether it’s good news or bad news, we ask that both buyers and sellers communicate at a high rate of speed. We vet those out.
If someone comes in and they’re not living up to that expectation of being a partner and communicating in a timely manner, we may ask them to leave. A business is not run by one person. It’s run by a team. It may not be a large team of several hundred or thousands of people but you have to have redundancies built in place so that way you can go on vacation and people can get answers when they need answers.
A business is not run by one person. It’s run by a team. You have to have redundancies built in place. That way, you can go on vacation, and people can get answers when they need them.
As somebody who’s got 25 years in sales, what is the hardest part of having to sell the ProCents organization? What do you find is the biggest pushback from buyers and sellers that want to come in?
The biggest pushback is that they see that it’s going to disturb and damage their existing relationships. That’s a pretty good statement to have but if those relationships are not giving you benefits of double-digit growth year over year, then you may have to look at finding new verticals. This is a new vertical. This is not scaling your population of salespeople. This is scaling your reach by looking at an environment that says, “Here are the key people within that environment in each organization. Reach out to them because they’re going to help you get moving forward.” A difficult thing to find within any organization is, “Who’s going to be that champion for your services or product that can help be the cheerleader when you’re not there?” That’s what ProCents has provided.
I go back to my Boeing days. My exposure to everybody that was in the industry was an annual trade show. Our biggest was in Madrid, Spain. We hop on an airplane, go to Madrid and spend three days where all my competitors were in the same room. All of the government officials and so forth that we were trying to sell or offer services to were all in the same room. You only had that opportunity for 2.5 to 3 days on the other side of the world but it sounds to me that you’re providing that environment but doing it daily I imagine on some digital basis, as opposed to everybody’s showing up to the same room every day like a trade show is.
Several different organizations do trade shows. We see that same thing being with someone for 2 days or 3 days. The excitement is there for 2 or 3 weeks afterward but then you usually fade at a high rate. For us, we utilize social media like LinkedIn, Facebook and Instagram. We have a Slack channel. We also send out tons of emails, making sure that people are interacting.
It’s sometimes repetitive but I have found that in this business, a lot of the questions you ask are repetitive. If you can give the same answer like, “You like buying this? We’re here for you.” “Our lead time is two weeks.” “Great. I can process my job because I was thinking it was four.” Stay front of mind. The thing for us is we’re trying to be that marketing arm and buying group that interacts in between the trade shows but leverages the trade shows or the industry events and helps build those partnerships.
Even with our sellers, we have them transacting with each other because they say, “We’re good here. We’re not here but you are. Let’s create a partnership,” which is amazing because they might be competitors on paper from a perspective but when you get down to it, their products are not the same. They can complete a fuller bill of materials to get the solutions done.
In the second half of my career within Boeing, my biggest competitor was the other big aircraft manufacturer, Airbus. Whenever we were doing a leading-edge project in a particular airport, we sometimes would ask Airbus to come on board with us because they know a lot more about their aircraft and capabilities.
We would purchase some consulting time from them where we’d be taking our approach models, arrival and departure routes and go, “Can you tell us whether or not your aircraft is capable of doing this kind of flight profile?” We were looking for the best solution for the customer as the government. If that means partnering with our biggest competitor to do that, why wouldn’t you? It sometimes goes against the grain in thought or logic because they’re your biggest competitor but the reality is you want the best solution for the end customer.
That goes back to asking and listening. Listen to the customer and ask the right questions. If your goal is to truly provide a solution and you don’t have the solution, the moment you lie to them discredit you forever saying that you care about your customer. That is inherently by partnering and saying, “Our weakness is here but we’re strong enough to say we’ll partner with our biggest competitor. I’d rather have a little bit of something than all of nothing.”
In that opportunity, to strut your stuff in front of the buyer who may eventually come over to you to do business with because they ran afoul with the other guy somewhere down the road and you provided a good service to them, it’s like, “We had a good experience with company B. Let’s go over and check them out since company A didn’t deliver at some point along that contract process.” Is ProCents only US-based or a global organization?
All of our buyers are here in the US but our sellers do buy on a worldwide scale. They’re only interacting with our buyers here in the US in 2022. We’d love for it to grow. I’ve always had the mindset, “You’ve got to get it right in your backyard before you can scale it to the world.” Luckily, in December of 2022, we’ll be three years in business. We still don’t have it all figured out, but we’re getting the local stuff plugged in and service those people before we try to spread our wings, fly, and get too close to the sun.
Tell us how ProCents got started. What was that nucleus or spark to say, “This might be a good idea for the industry and a way that we can offer value to a need, want or desire that’s out in the energy industry?”
It was formulated from two things. The first was when I started with a large global LED manufacturer that launched in the US and was the first salesperson they hired. One of the things I was tasked with was trying to get into a buying group. Two other buying groups within the energy space focus on a lot of different things. As a billion-dollar company and the largest chip manufacturer in China, we were not able to get into the buying group because they said we have too many products like yours.
Even the leadership of that company was like, “Let’s try to buy our way in.” They were going to pay a penalty to get in but even with those penalties to pay to get in, they couldn’t get in. I’m watching a billion-dollar company try to spend money to get in to give away several people’s salaries because they knew the growth opportunity. Being connected with the right people in the right places helps alleviate a lot of the pain points of going out on the road every day, knocking on doors. It creates a nucleus of customers in a shorter period where you can build value in shorter period.
When I saw that, I was like, “There’s a gap.” I also saw that the other groups were doing a lot of different products like the pipe wire conduit, PPE tools and a variety of different things. As an energy professional, I was like, “Why don’t we look at it and focus on energy products?” It gives me a smaller pool of sellers and buyers that are focused on solely doing lighting projects.
We don’t have buyers that are out there swinging hammers as a rough end frame or anything like that. It’s not that they’re not capable of doing it. That’s just not their skillset. As the architect of their business, they’re focusing on doing energy efficiency projects, not doing other things. There was a gap. Within that gap, I saw the opportunity for ProCents to come about. Working within the energy space and different lighting manufacturers, I saw as an entrepreneur sometimes working with companies whose vision and goals were bigger than their company’s visions and goals.
It’s not that they’re bad companies but it creates an internal conflict within the parties. I didn’t want that to be there because I have respect for these people. They might have respect for me. I will not put words in other people’s mouths so I was like, “If I can create a vehicle that allows them to hitch their wagon to what I’m trying to do and we work together in building partnerships, there’s probably a pretty good path here.”
There’s probably a pretty good opportunity for business development for all parties involved. Luckily, the way our organization and community are set up, we only take in the successes. We don’t take in the failures. If there are no transactions, which I would call failure, there’s no penalty but when success happens, we’ve done our part so all parties are rewarded.
Did you put together a plan, hang your ProCents single out, sit down with some of the decision makers within the buyers and sellers and go, “I’m open for business in the marketplace. Come join it?” Did you start with an idea or maybe you had a plan in your head and then went and sat down with some decision makers, the buyers and sellers and go, “I’m thinking about this idea. It’d be great for your business and the industry?” What do you think?
It was a good combination, a hybrid of both. When I saw the opportunity to form ProCents, I didn’t know all my weaknesses and I still don’t but I knew my strengths. I formed a board of directors, both buyers and sellers, men and women that helped me look at the plan that I was putting together and say, “Let’s take this to market.” They go, “No. That’s crap.” We look at the ground and go, “Why is that crap?” “We need to polish off this burst. That’s good but this is crap so we’ll leave that there.” It helped us better streamline the serviceability of ProCents in the community and communicate the value proposition of what ProCents offers for the community members.
Luckily, the very first people who join ProCents are still active members. Two of them leave the board because they’d gotten so busy that they didn’t have the time to serve on the board in a voluntary position. We brought on some other experts, which has given us a new perspective of, “This is what we’ve built.” It’s a constant evolution. The moment my business is running perfectly, it’s going to create the biggest blind spot that I never saw.
The moment I think my business is running perfectly is the moment where I create the biggest blind spot.
Having people that feel comfortable enough with me to say, “Matt, have you seen this or that,” gives me the opportunity to look in both directions and say, “Thank you for bringing that to my attention. Let’s figure out how we can address these things.” If we’re only servicing 30 or 40 people at a time, it’s pretty easy but to grow it and find the value for our buyers and sellers, we have to constantly be changing the value and also the integration between the different markets.
Your initial board of directors is made up of buyers and sellers. How much education occurred in those conversations? In other words, buyers are getting educated on issues that sellers have to deal with in their business and vice versa.
It was a doctorate-level education. Let’s say you’re a seller and you have a solution or product that you’re bringing to the market. Your marketing team has crafted the solution and how you pitch that solution. That solution was crafted in Dallas, Texas, where everyone’s from Dallas, Texas. The second you go to California or New York, which are different markets based on energy rebates and other types of governing bodies, that marketing no longer has any value. It allowed people to gain a perspective of a global organization by having a global recheck. It was phenomenal.
I always said that I would never want to do business in California. It’s not that I don’t like California. I love California. It’s a beautiful state. I’ve had a lot of fun there but with the products that I had to bring to a customer and knowing the structure that they had to work within the confines, I could not, in good conscience, bring my solution to them. It may have been a better price but it would not have allowed them to get the incentives from the state or the federal government.
If I’m not bringing forth the full solution and I’m only bringing forth 10% of the ingredients, I’m not able to service that customer. That’s what allowed it to happen but it also allowed the buyers to say, “If we’re not working in this context of new construction but we’re working in a retrofit capacity or an MRO capacity, there are buckets in how we can pull things in. That’s 5% of our business where 95% exist.” It allowed them to tailor their approach and products. You’re like, “There’s a big opportunity in California.” There’s a big opportunity in any state that you look at. You just have to look and drill down to the utilities and the governing bodies that oversee that for the incentives.
I asked that question because the closest thing in my career to came to what you have done here with ProCents was a project that my team worked on to redesign the airspace over Denver, Colorado. FAA had tried to bring in GPS a couple of times on projects and was not successful. There’s an art to designing an arrival route where it meets technical standards and it’s a safe one but at the same time, it can make a flight crew in an airplane be gyrating all over the place to try and make it work. There’s an art to it. If the air traffic control side doesn’t understand what it takes to fly that procedure from a flight crew perspective, they have no idea how well to design it.
Like you brought buyers and sellers together, we help facilitate bringing the airline pilots together with the FAA folks, sit in a room and learn about each other to the point that we had air traffic controllers in flight simulators with the procedures. We put them through the paces with pilots, taking notes and understanding what a flight crew has to go through to land an airplane on an arrival route. You get this communication that never happened because they’re in their silos but all together in a room working on a common problem.
That’s what I see with what you’re trying to do here with ProCents. You’ve got buyers talking to sellers, sellers are beginning to understand what buyers have to go through with regulations and everything else to make a successful project for themselves and that exchange of information makes things better overall for all parties.
Many of the companies that come into the US say, “We want to come to the US because it’s a big opportunity to sell products.” Nothing that could be said for a lot of different places but they’re like, “It is the US so you have UL, Underwriters Laboratories which is the safety standard, Energy Star, which is based with the Department of Energy, and DesignLights Consortium.” Those are the governing bodies.
Every time you get into a municipality is where things start to change. You find people have different pain tolerances for each. I still am amazed at the State of Florida and how they’ve grown without incentivizing all the other states. When people come in not being aware of those things, they’re like, “We can do it this way. It works across the entire country.” No. You’ve got to understand and have those communication lines that are going to help you find the best solutions.
Is ProCents unique in the world? Do other industries have these business models and marketplaces out there?
I did allude to the other two buying groups within the electrical distributor space. I won’t name them. I don’t want to give them that much clout because they do very well. I’ve heard of other communities within automotive manufacturing and some other things for spirits like alcohol and also tobacco. There are consortiums like Rocky Patel Cigar that might have a large field but sell off their excess or make blends. It allows them to keep their production costs low because they’re producing so much but also say, “Instead of wasting it, we can create these other lines or help support other lines. We’re still going to be able to put our name on it and say, ‘This is Rocky Patel.’” I’m speaking out about things I don’t know. I might enjoy them, but that speaks to them.
The same thing is going through my head. I’m thinking about old wine barrels or old bourbon barrels being bought out by others within the same spirits industry to be used in their manufacturing so that companies are somewhat recouping some of the cost of their expenses to generate their product. If you didn’t have that marketplace, that might be a very difficult connection to find those opportunities.
If you’ve ever been to Kentucky and your audience is in Kentucky, they would attest to it. Bourbon has very finite rules that you have to abide by. Even when some of the fires happened in some of the wrecked houses and inventory was lost, they didn’t stop production because Jim Beam may have helped Knob Creek and so on. They’re like, “We’re running low on barrels.” It’s a community. That’s what ProCents is.
We want to bring a community together. Every one of these people inside our community is an industry leader but even if you’re coming into the industry looking for hard knocks education and willing to humble yourself to learn from these industry experts, these people’s calendars are booked but they’re going to make time to help because they understand that their success for a longer period is having partnerships.
My co-host’s wife, Megan, is from Kentucky. Years since I’ve known her, she’s educated me a lot about bourbon in general and the manufacturing process. Someday, she’s going to throw me in the car, take me up to Kentucky, go do some tasting and get some behind-the-scenes to look at that whole industry.
Let’s move out of ProCents for a second. You’re a CEO and a leader of an organization. If you’re in that spot of somebody’s moving up the food chain or desires to start their business and therefore become a business leader or a CEO of an organization, what do you think has been your biggest learning point along your path and journey of becoming a CEO of an organization? What was the biggest a-ha like, “I’ve got to have this skill or talent. I’ve got to learn how to do this one thing better to be a more effective leader as a CEO?”
Being a CEO, it’s a great responsibility to develop those things underneath you and around you. You never know where that next leader is going to be. I guarantee that many years ago when I was starting my journey, no one was looking at this guy going CEO material but I had some people invest some time in me to help me gain a perspective of what that is.
One of the things I’ve learned over the last few years is CEO is a title like a janitor is a title. They’re two different polar opposite when you think about those in your mindset, but every one of those have barriers and rails around them that you have to stay within. For me to be the best CEO possible, I’m trying to find the person that’s going to replace me, take what I’ve done and move it forward, whether that’d be through hiring someone, promoting someone or selling the position but I have to find someone and invest time into them.
To be the best CEO possible, try to find the person that will replace you, take what you’ve done, and move it forward.
This is fun. I enjoy the ride but it’s not what I want to do forever. There are other things and passions in life. My passion is connecting people, which is ProCents. It’s my catchphrase, “The power of connections.” The more I can connect with people is great. If I’m a CEO, it limits me on how many people I can connect with. I’m not able to work in other industries because they’re like, “You’re the CEO there. We need to get NDA signed.” There are trade secrets, so I’ll humble myself and become an employee.
A CEO’s mindset is to always be growing and looking for the next opportunity. That’s why I’d like to think of it as a mindset. I’d never want to be identified as a CEO, an entrepreneur or a janitor. I’m connecting people and I’m focused. With that, if I can better someone else’s life and connect with people, my head is going to hit the pillow every night and I’m going to sleep well.
One of my favorite phrases is, “You’re not about the doing. You’re about the being.” “I want to be this way and align what I do regardless of what the title is so that aligns with my being.” You want to be a people person and a connector with a growth mindset supporting other people. You’re like, “I want to be that way in this world.” That’s more important to me than whether I’m a CEO, a janitor, a sales guy, or whatever it may be that you land yourself. What do you think is the next step for Matt Russell? Is there anything you’re working on?
Honestly, I am working to help a couple of businesses. I’m putting a little bit more time and effort into R-Core to launch that. I’m also working inside another organization to help them achieve their goals. The great thing about it is coming from outside an industry, I get to see and bring the customer’s point of view with me. Everyone’s an expert when they’re in the industry but the people you’re selling to may not be experts. It’s great. I’m hoping I can accomplish 2 and get 1 more joint venture underneath my belt for ProCents in 2022. We launched one in September 2022 so that was good. I’ve got one more in the pipe if we can get that one set down. Big dreams need big actions.
Our time is coming to a close. If somebody was interested in entering the ProCents’ marketplace or wanted to talk to you about becoming the future CEO or anything of that nature, what’s the best way somebody could reach out and get ahold of you?
A way to reach out to me is through Matt@ProCents.com. You can also find me at MattRussellMedia.com. I’m happy to have a conversation. Do me a favor and say that you’ve known this message on Andy’s show. That way I know where you’re coming from because I’d like to give Andy a big thank you for that.
I would appreciate that. Zach and I always end our conversation with a guest with the same question. The question has no right or wrong answer. It is about what’s in your heart and mind. Life experiences are brought to the answer to this question. The question is what do the words “generate your value” mean to you?
Generate my value means that I’m living my goals and purpose in a daily manner that the people I interact with like my family will remember many years after I’m gone. It’s not going to be 1 thing or 1 day. It’s going to be an accumulation of things. Staying consistent is how I generate my value.
You generate your value when you’re living your goals and purpose daily.
I appreciate your answer to that. We greatly appreciate you investing your time. We know your time is precious to come onto the show and share your life story, career story and business story with others. Hopefully, somebody’s taken away what I call a golden nugget out of our conversation and integrated it into their life, personal life, business life, whatever it may be. I appreciate you coming onto the show.
I appreciate you, readers, for taking time out of your day to read my conversation with Matt. Hopefully you did get a golden nugget, if not more out of it from this. As we have in the past, we’re releasing episodes every Tuesday afternoon. I’ve got a lot of people lined up for episodes for you to come in and get something out of it. Hopefully, we’re going to be generating some value in your life.
From that perspective, I will let you know I got invited to be an executive contributor for Brainz Magazine. It’s an online magazine that deals with leadership business and life issues. I invite you to find me over there. I’ll be writing an article every month, continuing to try and add value to people’s lives through that particular medium in the future. With that being said, have a great time. I hope to see you next time for our next episode. Keep generating your value in this world. Take care.
IMPORTANT LINKS
ABOUT MATT RUSSELL
